Knocked Down, Not Out

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On the day in March that Gov. Ron DeSantis signed the Florida Legislature’s historic changes in the laws governing the personal injury litigation arena, the chief operating officer of Orlando-based Morgan & Morgan wrote a memo to staff. A ubiquitous advertiser in Florida and nationally, under founder and main pitchman John “For the People” Morgan, the firm boasts of more than 800 lawyers and $15 billion recovered for clients.

The memo to the firm’s personal injury attorneys began cheerily enough, with a “Good morning PI lawyers across the country!” Then came the anger. COO Reuven Moskowitz advised attorneys it would be a serious “internal offense” if “any courtesies” on extensions were given to insurance industry lawyers. “Not one inch” should be given ever to insurance courtroom foes, Moskowitz wrote, because they “work for an enemy who is heartless and ruthless. The enemy who just tried to kill us in FL. They work for the enemy who would like nothing more but for you to be unemployed.”

Moskowitz stood out in the personal injury field for his vehemence but not for seeing firms like his as a target. The insurance industry and state business group leaders indeed had “billboard” law firms in their sights when they curbed Florida’s lucrative industry of representing people hurt in auto accidents and slip-and-falls, by dog bites, by medical malpractice or victimized by crime on someone’s property. “Florida has more billboards telling people to sue someone than any other country in the world, let alone another state,” says Mark Wilson, CEO of the Florida Chamber of Commerce.

In an exercise you could repeat in any Florida metro, drive along suburban Sample Road in Broward County and in a 1.5-mile stretch near the junction with Interstate 95 you will pass seven billboards for personal injury legal services — some in English, some in Spanish, one in Portuguese with the Brazilian flag. Meanwhile, Central Florida drivers know well the Dan Newlin name, as in billboards touting that “Dan Got Me” or “Dan Got Us” settlements ranging from $350,000 to $5 million.

The new law, however, goes after all personal injury claims, whether brought by large firms that live off mass advertising or small firms relying on word of mouth.

Battles over tort law — the righting of a wrong via civil suit damages — are nothing new and have gone on for decades in Florida. With so many lawyers serving in the Legislature and millions of dollars of campaign contributions from trial attorneys in play, Florida tort laws were a power struggle for decades until 2023.

In Florida, business interests and the insurance industry complained the plaintiffs' bar enjoyed too much leverage. The business-backed American Tort Reform Foundation in 2017-18 named Florida the nation’s top “Judicial Hellhole.” (Other states have since gotten the top ranking.) The Florida Chamber’s Florida Scorecard ranks the state as having the nation’s fifth worst legal climate. The state’s property insurance crisis, blamed on excess litigation, didn’t help the plaintiffs' bar. Property insurers won approval of their agenda in a December 2022 special legislative session. 

Fresh from that victory and with a governor and legislative leadership keen to do more, business groups and the insurance industry launched a reinvigorated effort this year against the business model for personal injury lawyers. The Legislature cut in half the time window for bringing most negligence cases, made some too financially risky for firms to take on, made others harder to win, curbed the plaintiff attorney fee payday when they did win and increased the difficulty of going after insurers for bad faith. “Unfortunately, this legislative session has been a huge boon for the insurance industry and a disaster for the customer,” says Andrew Yaffa of plaintiff firm Grossman Roth Yaffa Cohen in South Florida.

There’s no shortage of personal injury lawyers willing to say the new law “slams the courthouse door” on personal injury victims. When it comes to the impact on their own financials, however, the personal injury firms live up to their image as close-mouthed on their business, a reputation noted in a 2015 study in the University of Illinois Law Review of personal injury firm finances. The study revealed a little: Run-of-the-mill cases keep the lights on while occasional blockbusters generate most of the fees. The business model at “referral” firms is about landing clients, then referring them out to other law firms for a share in the outcome. When Morgan & Morgan launched in the Philadelphia market several years ago, its model — according to a competitor who complained of lost business and filed legal action — was advertise heavy, land clients, refer them.

Morgan says the new law will strengthen his firm’s business. “Law firms who don’t ever go to trial will suffer, as will their clients. That makes up about 90% of all firms. We try more cases than any firm in America. The courtroom is where we live. The strong will flourish and the weak will perish,” he wrote in a statement to FLORIDA TREND.

Steve Cain, president of the plaintiffs bar Florida Justice Association, says the new law “impacts the entire industry” but at varying degrees depending on the type of practice and type of clients. “I certainly believe you’re going to see a great impact on a lot of firms,” he says. Some firms, for example, don’t handle negligent security claims — which underwent a key change by the legislature — so changes in the law on those cases are irrelevant to them.

Partners at boutique personal injury firms say they face the least disruption because they don’t have call centers and large ad budgets to support. Aaron Davis, co-managing partner of seven-lawyer Davis Goldman in Fort Lauderdale and Miami, says a firm like his, unlike large firms that pursue volume, doesn’t rely on “low-exposure claims” that insurers settle rather than spend to defend. “That, in my view, is what allowed a lot of these billboard lawyers and advertisers to succeed,” he says. “It’s not the big cases, it’s the small ones that they push out at a scalable level.” Davis says the new law “places a premium on running a sophisticated practice, carefully evaluating your cases. And understanding how to adjust for the changes in the Legislature when you’re trying cases in front of a jury. So our firm, in my view, has a bright future.”

Rachel Furst, a partner at Maderal Byrne Furst in Coral Gables, a small firm representing clients with catastrophic injuries and loss of life and also in class actions, says, “The Florida Legislature has spoken. Juries are made up of average Floridians awarding damages. That’s the voice that matters for our practice, the voice of the jury. We will innovate and be able to bring claims within the confines of the law.” She says that while “without a doubt, the law is targeted at plaintiffs’ lawyers and practices,” curbing litigation cuts both ways in the legal business. “I doubt there are many lawyers, whether on the defense or plaintiffs’ side, celebrating the law from a business standpoint.”

Some attorneys argue the law will increase litigation. Cain, the Florida Justice Association president and a partner with Stewart Tilghman Fox Bianchi & Cain in Miami, says that different judges already have reached opposing interpretations of the new law, signaling lots of litigation ahead.

The Newlin firm’s lead trial counsel, Richard Dellinger, says the firm filed “somewhere around” 4,000 suits ahead of the bill’s passage to ensure clients had the benefit of the old rules. The practice has also increased litigator and support staff by 25% to 30% since the bill passed. “We’ve been hiring litigators left and right,” he says.

Plaintiff firms do say adjustments to the new law will include being more selective about cases. Two areas singled out: Negligent security and comparative negligence.

Negligent security concerns someone victimized by crime at a property such as an apartment complex. Previously, the criminal didn’t appear on the jury verdict form as a responsible party for the damages. Now, the criminal will be on the form. Plaintiff attorneys worry juries will place the lion’s share of the blame and damages on the criminal — who often won’t or can’t pay — rather than the property owner who enabled the crime and has insurance that can pay. “I can’t see me ever taking a negligent security case,” says Scott Pauzar, a personal injury lawyer at Woodward, Pires & Lombardo in Naples. “The recent changes to the tort law are resulting in me being a lot pickier about what cases I take on.”

Comparative negligence is when someone injured bears a degree of responsibility for the incident, as in two cars colliding at an intersection with one driver speeding and other running the light. Previously, the plaintiff collected damages for whatever share wasn’t his fault. Now, if a jury finds the plaintiff more than 50% at fault, the plaintiff collects nothing. The law will make firms less likely to front the cost of a claim that’s a close call. Newlin’s Dellinger says, “We will certainly give cases where there’s comparative negligence a hard look,” but, he added, “up to this point we’ve been selective in comparative negligence already.”

The unintended always makes it impossible to predict who wins and loses under a new law, says Robert Jarvis, a professor at Nova Southeastern University’s Shepard Broad College of Law. “We’ve been tinkering with tort reform for as long as anyone who is alive and living in Florida today can remember,” Jarvis says. “Somehow, the plaintiffs' lawyers always find a workaround, one way or another. Lawyers are resourceful and highly creative — especially when their livelihood is on the line.”

He would find agreement, in a way, from one of the key advocates for the new rules: The Florida Chamber’s Wilson. “The personal injury trial lawyer industry — I think they invented the Whac-A-Mole game,” Wilson says. “They’ve got all those billboards up. They don’t want them to go to waste.” He has seen the plaintiffs bar continually find new areas in which to sue and expects that to continue. He expects the plaintiffs bar to challenge the recent changes. And, he says, the new rules don’t end personal injury litigation; they merely move Florida from fifth-worst to middle of the pack among states. He says there’s no “victory lap” to be taken.

Jarvis offers a bit of history to explain why. In 2004, physicians convinced Florida voters to amend the state Constitution to guarantee medical malpractice claimants a higher share of any amounts recovered. The business model for plaintiff firms in medical malpractice cases is to cover the expensive costs of the case in return for a substantial contingency fee. The doctors aimed to make medical malpractice cases financially unviable for firms by enshrining a constitutional cap on a lawyer’s payout. Few cases would be worth the law firm’s risk. “The idea was, ‘we’re going to shut down the plaintiffs firms,’” Jarvis says.

It didn’t happen. Law firms, the Florida Bar and eventually the state Supreme Court in 2006 reasoned that if people can waive constitutional rights such as the right to remain silent, they could waive their right to the caps if that’s what it took to get a lawyer to take their case. Waiver forms were drafted and suing over medical malpractice went on.

Says Jarvis, the Nova law professor, about this year’s tort changes, “The lawyers won’t take it in the ear. The lawyer will go on to the next case and the next case. The lawyers will be fine. The lawyers are always fine.”

The Defense Case

The Legislature’s rewrite last year of state property insurance law threatens the business model of plaintiff firms. It might not be so good for insurance company lawyers either.

Jeffrey Wank, an attorney for insurers, says that regardless of the impact on defense firms, the changes were needed. Insurers were ceasing to write coverage in some areas while others left the market. Some failed. “That’s really bad for business,” Wank says. “From the defense side, we obviously don’t want our clients to go out of business. I see this as a positive change.” Wank chairs first-party property and insurance coverage at Kelley Kronenberg, which has about 100 attorneys handling property and insurance defense in Louisiana and Florida and averages approximately 5,000 active files.

The changes in the laws eliminated assignment of benefits, in which contractors would get homeowners to sign over their rights under their policies in return for doing repairs. Insurers said — and legislators agreed — it led to widespread abuse. Wank says that elimination will reduce the volume of litigation and “all defense firms will have to react to that and plan for that.”

But in the larger field of property insurance claims, “time will be the deciding factor as to whether the operations will be reduced for defense firms,” he says. “The Legislature certainly can’t cure storms, fraud and insurance claims. The change in the law has not changed our climate or the amount of claims that will and can be filed.”

Wank says the door hasn’t been closed for homeowners who believe their insurer has wronged them. He says homeowners with claims even down in the $10,000 range will still be able to find attorneys to represent them.

Unauthorized Access

Visual artist Craig Krefetz in 2003 was staying at a friend’s house in a gated community near Boca Raton while preparing for an art show. He heard knocking at the front door and was surprised to hear the voice of the homeowner’s former domestic helper. The homeowner and Krefetz suspected the woman of being behind a break-in, theft and vandalism that had occurred previously. Because of those suspicions, the community gate security team had been given specific instructions not to let her in. She was let in anyway. While Krefetz didn’t want her to come in the house, the homeowner — who wanted to ask her about the break-in — overruled him. Krefetz let her in, retreated to his room and locked the door. About 45 minutes later, he heard the homeowner screaming for help.

When Krefetz went to investigate, the woman jumped him and repeatedly stabbed and slashed him with a knife. She punctured his lung. He has a distinct memory of one first responder telling another that he had lost too much blood and would die. He was airlifted to a hospital, spent five days on life support and survived. He spent years recovering physically and developed post-traumatic stress disorder. The homeowner, likewise, was slashed and hospitalized. He died within a few days, though a medical examiner decided he died of a heart condition, not the attack.

The attacker served eight years in prison. Krefetz is still upset he didn’t receive restitution from her. He also wonders how she ever got past the guard gate. “There was negligence there, no doubt,” he says.

Darryl Kogan of Kogan & DiSalvo, a personal injury attorney, filed suit on his behalf. Kogan won Krefetz a six-figure settlement from the security company that staffed the gate and from the homeowners association. (There was a confidentiality agreement in the settlement that Kogan says prevents him from disclosing the amount.) Krefetz says the money paid his medical bills and “put a little money in my pocket.”

Kogan says that under the tort law changes the Legislature approved this year, Krefez’s case wouldn’t be brought. Now, the criminal in such a case of “negligent security” must also be listed on the verdict form juries use when they apportion liability and damages.

“Since a very large portion of the fault would be attributed to her for causing the injury, cases like Craig’s will no longer be viable,” Kogan says. “The negligence or fault of the security company and HOA would be far overshadowed by the fault of the intentional tortfeasor (the woman who attacked Krefetz), making this case a nonstarter under the new laws.”

Florida’s ‘Tort Tax’

The tort system costs $5,065 per Florida household and represents 3.63% of the state’s $1 trillion GDP, according to a 2022 study from the U.S. Chamber of Commerce Institute for Legal Reform on tort costs and compensation, using insurance company data and estimates from self-insured entities. The share for the U.S. is 2.1%. The torts include general and commercial liabilities for personal injury, consumer and other claims, auto accident claims and medical liability claims.

Tags: Government/Politics & Law, Feature